The summer job market is losing heat, with long-term unemployment quietly climbing to its highest non-pandemic level since 2017. According to the WSJ, 1.8 million Americans have now been unemployed for 27 weeks or longer, raising concerns about the lasting financial and career impacts for displaced workers.
While layoffs remain low for those already employed, job seekers, especially younger workers and recent graduates, are encountering one of the most difficult job markets in years. Hiring rates have slipped to levels not seen since 2013, and nearly 25% of all unemployed individuals have been out of work for over six months.
Several factors are at play. Economic uncertainty, high interest rates, and trade policies are making companies hesitant to expand their workforces. Some businesses are also favoring experienced hires over entry-level candidates, further narrowing opportunities for young job seekers.
And while still difficult to quantify, artificial intelligence is beginning to reshape how companies assess talent, and how many people they ultimately need to hire.
Major employers like Bank of America have already indicated that AI could reduce future hiring needs, suggesting that automation may be tightening the labor market, even in roles traditionally seen as stable.
At the same time, job seekers are also turning to AI to help with applications, leading to a potential saturation of generic résumés and cover letters. As the market becomes more automated, there’s speculation that human connection — through networking and personal referrals — could once again become the key differentiator.
The consequences of this hiring slowdown could have long-term effects, particularly for young professionals just beginning their careers. Entry-level salaries and first-job experiences often set the tone for future earnings and advancement. Workers are left in a state of limbo, trying to chart careers in a market that is cooling fast — and changing even faster.
